Concord Inc. acquired 20% of the outstanding common shares of Gregson Inc. on December 31, 2022. The purchase price was $1,001,000 for 45,500 shares and is equal to 20% of Gregson's carrying amount. Gregson declared and paid a $0.70 per share cash dividend on June 15 and again on December 15, 2023. Gregson reported net income of $540,000 for 2023. The fair value of Gregson's shares was $23 per share at December 31, 2023. Concord is a public company and applies IFRS. (a)
Concord Inc. acquired 20% of the outstanding common shares of Gregson Inc. on December 31, 2022. The purchase price was $1,001,000 for 45,500 shares and is equal to 20% of Gregson's carrying amount. Gregson declared and paid a $0.70 per share cash dividend on June 15 and again on December 15, 2023. Gregson reported net income of $540,000 for 2023. The fair value of Gregson's shares was $23 per share at December 31, 2023. Concord is a public company and applies IFRS. (a)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
choose from the following accounts:
Accumulated Other Comprehensive Income
Allowance for Investment Impairment
Bond Investment at Amortized Cost
Cash
Commission Expense
Dividends Receivable
Dividend Revenue
FV-NI Investments
FV-OC|Investments
Gain on Disposal of Investments - FV-NI
Gain on Disposal of Investments - FV-OCI
Gain on Sale of Investments
GST Receivable
Interest Expense
Interest Income
Interest Payable
Interest Receivable
Investment in Associate
Investment Income or Loss
Loss on Discontinued Operations
Loss on Disposal of Investments FV-NI
Loss on Disposal of Investments FV-OCI
Loss on Impairment
Loss on Sale of Investments
No Entry
Note Investment at Amortized Cost
Other Investments
Recovery of Loss from Impairment
Unrealized Gain or Loss
Unrealized Gain or Loss - OCI
Transcribed Image Text:Concord Inc. acquired 20% of the outstanding common shares of Gregson Inc. on December 31, 2022. The purchase price was
$1,001,000 for 45,500 shares and is equal to 20% of Gregson's carrying amount. Gregson declared and paid a $0.70 per share cash
dividend on June 15 and again on December 15, 2023. Gregson reported net income of $540,000 for 2023. The fair value of Gregson's
shares was $23 per share at December 31, 2023. Concord is a public company and applies IFRS.
(a)
Your answer is correct.
Prepare the journal entries for Concord for 2022 and 2023, assuming that Concord cannot exercise significant influence over
Gregson. The investment is accounted for using the FV-OCI model. (Credit account titles are automatically indented when the amount
is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Record
entries in the order displayed in the problem statement. List all debit entries before credit entries.)
Date
Dec. 31, 2022
un. 15, 2023
Dec. 15, 2023
Dec. 31, 2023
Account Titles and Explanation
FV-OCI Investments
Cash
Cash
Dividend Revenue
Cash
Dividend Revenue
FV-OCI Investments
Unrealized Gain or Loss - OCI
¯¯¯¯¯¯
Debit
1001000
31850
31850
45500
Credit
1001000
31850
31850
45500
Transcribed Image Text:Prepare the journal entries for Concord for 2022 and 2023, assuming that Concord can exercise significant influence over
Gregson. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required,
select "No Entry" for the account titles and enter O for the amounts. Record entries in the order displayed in the problem statement. List all
debit entries before credit entries.)
Date
Account Titles and Explanation
(To record collection of dividend)
(To record investment income)
Debit
Credit
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